Palko Environmental Ltd.
TSX : PLK

Palko Environmental Ltd.

July 07, 2011 16:38 ET

Palko Announces New Bakken Waste Facility at Stoughton, Sk and Renews Banking Agreement

CALGARY, ALBERTA--(Marketwire - July 7, 2011) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.

Palko Environmental Ltd. ("Palko" or "the Company") (TSX:PLK) is pleased to announce that it has received regulatory approval and will commence construction of a new oilfield waste handling facility in the Stoughton/Viewfield area of Saskatchewan. Along with Palko's recently announced new Oungre facility, operations are expected to begin in the latter part of 2011.

"With estimates of total oil in place starting at 4 billion barrels of high netback oil, the Stoughton/Viewfield Bakken is the second largest conventional light oil pool in Canada. We are pleased to provide our Bakken customers with superior oilfield waste handling, recovery and disposal through the Stoughton spoke of Palko's southeast Saskatchewan network of four facilities" said Steven Peterson, Palko's President.

Palko obtained a wellbore next to the Stoughton facility and will recomplete the well for disposal. The facility will accept upstream oilfield waste fluids and treat produced oil emulsions. The facility is adjacent to a provincial highway and Enbridge's crude oil pipeline network. Future expansion possibilities for the site include solid waste management, water recycling and pipeline connected terminalling. Funding for the Stoughton facility will be attained from 2011 operating cash flows and availability on credit facilities.

Palko is also pleased to announce that it has renewed and increased its available credit facilities from $21.6-million to $23.5-million. The credit facilities consist of: a $3-million operating facility due on demand; and a $20.5-million committed 364-day extendible revolving credit facility. If not extended for a further 364 days on May 31, 2012 the extendable revolving facility will be repayable in 24 equal monthly payments and fully repaid by May 31, 2014. 2011 anticipated cash flow in combination with the increased credit facility should provide ample liquidity to fund current year operating and capital programs.

About Palko Environmental Ltd.

Palko provides processing and disposal of oilfield and industrial wastes through our network of waste handling and hydrocarbon recovery facilities located across Alberta and Saskatchewan. Our focus on client service extends to custom oil treating, waste oil reclamation and crude oil market access for customers.

Our services support all aspects and stages of oil and gas exploration and production, including drilling, fracturing, completion, production and subsequent abandonment and reclamation. In addition, Palko provides hydrocarbon recovery and waste management solutions for a variety of non-oilfield and industrial wastes of similar composition.

Additional information about Palko Environmental Ltd. is available at www.sedar.com and on the Company's website at www.palko.com.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

Certain statements in this press release constitute "forward-looking" statements that involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Palko, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. When used in this document, such statements use such words as "may", "will", "intend", "should", "expect", "believe", "plan", "anticipate", "estimate", "predict", "potential", "continue", or the negative of these terms or other similar terminology.

Such statements include:

  • Palko's expectation that they will be able to commence construction of the new waste disposal facility in Saskatchewan with operations to begin before the end of 2011;
  • Palko's expectation that there will be demand for the services to be provided by Palko at the new facility;
  • Palko's intention to recomplete a waste disposal well;
  • Palko's future expansion possibilities, including solid waste management, water recycling and pipeline connected terminalling; and
  • Palko's ability to finance the proposed construction and recompletion from 2011 operating cash flow and available credit facilities.

These statements reflect current expectations regarding future events and operating performance and speak only as of the date of this document. These statements are based on certain assumptions, including:

  • a stable or improving economy;
  • stable or increasing commodity prices;
  • continued stability or growth in the oil and natural gas industry;
  • an expanding market for the Company's services;
  • that any remaining necessary consents for and regulatory approval of the Company's proposed construction and recompletion will be obtained;
  • that all necessary items for the new facility will be obtained; and
  • that existing credit will continue to be available.

Although Palko believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that these expectations will prove to be correct. There are risks which could affect Palko's future results and could cause the results to differ materially from those expressed in these forward looking statements including:

  • the impact of general economic conditions in Canada and the risk that they will deteriorate;
  • industry conditions, including fluctuations in the price of oil and natural gas and the risk that they decrease;
  • that required consents and approvals from regulatory authorities will not be obtained;
  • that drilling activity will not be at the level or of the nature anticipated;
  • liabilities and risks inherent in Palko's operations;
  • technical and drilling problems, equipment failure and construction or delivery delay; and
  • that the Company's credit facility may be decreased.

Statements of past performance should not be construed as an indication of future performance. Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors, including those discussed above, could cause actual results to differ materially from the results discussed in the forward-looking statements. Any such forward-looking statements are expressly qualified in their entirety by this cautionary statement.

The forward-looking statements included in this Press Release are made as of the date of this Press Release and Palko undertakes no obligation to publicly update or revise forward-looking statements other than as required by applicable laws. You should not place undue reliance on forward-looking statements.

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